This comes as Mahindra & Mahindra, which held a majority stake in the company, opted out from supporting the distressed company any longer, despite repeated efforts to revive its business
Troubles for the loss-incurring South Korean automotive company SsangYong Motor Company do not seem to be ceasing any time soon, amid which it is now looking for a new majority investor by October to complete the sale process of its business, a recent report suggests.
Citing two people aware of the development, The Economic Times reports that SsangYong is expected to invite tenders by next month and is likely to submit a restructuring programme by the first week of July, with the consent of the employees’ union. The court-appointed auditor, Ernst & Young Hanyoung, will oversee the sale process, said the people.
This comes as Mahindra & Mahindra, which held a majority stake in the company, opted out from supporting the distressed company any longer, despite repeated efforts to revive its business.
Mahindra & Mahindra had been searching for a new buyer for SsangYong for a year before it was put into court receivership. Mahindra & Mahindra also withdrew its plans to invest $400 million equity into the South Korean firm.
In the past few weeks, SsangYong Motor has also axed a few senior executive jobs as it continues with its ongoing cost-cutting drive.
According to the report, SsangYong Motor has been in talks with US vehicle importer HAAH Automotive to sell its majority stake as it filed for court receivership in December 2020 after failing to obtain approval for the rollover of 165 billion won worth of loans from creditors. The value of the stake is likely to be fixed around $250 million, offered earlier by HAAH Automotive.
It is reported that the company would likely see more electric vehicle (EV) bidders for it, with companies like Edison Motors and several other EV players including a private equity firm showing interest in it.
